Controversial Grand Rapids land swap deal pays off for city

GRAND RAPIDS -- City commissioners who once questioned whether they were getting shorted in a real estate exchange with Kent County were smiling today.

The city is among the winners after real estate developer Ed DeVries entered negotiations and offered to buy the former county Department of Human Services building at 415 Franklin St. SE, they said.

DeVries also agreed to sell the city the Development Center building. He's been renting it to the city for the past decade. When the deal is completed, the city will spend $100,000 less per year at 1120 Monroe Ave. NW, commissioners said.

"This is a win, win, win, win situation," said 1st Ward Commissioner Walt Gutowski, who opposed the original deal to take the DHS property from the county in exchange for five parcels the county needs for parking at its new headquarters.

"This is the closest the city could get to having its cake and eating it, too," said 2nd Ward Commissioner David LaGrand. "Frankly, I did not expect us to get as good a deal as we got."

Here's what each party gets out of the deal, which will close next year:

• The city will get possession of the Paul I. Phillips Gymnasium, which was part of the DHS property. The gym is home to several recreational basketball programs that were run jointly by the city and county.

• The city also gets a large parking lot from the county along Pleasant Street, east of Madison Avenue SE. The lot, once used by DHS employees, is considered future green space for the Heritage Hill Neighborhood.

• The city also will buy the Development Center, an office building it rents from DeVries, for $4.2 million. The three-story structure is a one-stop center for developers and property owners who do business with building inspectors, planners and code enforcement teams. The building also has other tenants that the city hopes to keep.

The city will borrow the money to buy the center through low-interest bonds available through the federal government's "Build America" stimulus program.

• DeVries, who specializes in revitalizing old buildings, will buy the former DHS building and a parking lot along Franklin Street SE from the city for $402,600.

DeVries said he does not know how he will redevelop the three-story building that served as Grand Rapids Christian High School until the early 1970s.

• The county will get five vacant lots the city owns across the street from its new DHS headquarters. County officials need the lots to expand parking.

"Those lots were of high value to the county and of low value to us," said Mayor George Heartwell, adding that he was grateful to county officials for their "good spirit" in working out the complicated deal.

Commissioner James Jendrasiak, who represents the 1st Ward, voted against the deal, saying he would have preferred to see the city relocate its Development Center to a former auto parts store it owns along Market Avenue SW.